January is a tough month. Christmas bills are coming in, credit card payments are due and the taxman is waiting to be paid.
Setting cash aside for the future can seem almost impossible – but Tatton Asset Management helps savers to invest money more effectively and business is brisk.
The company works exclusively with independent financial advisers, offering them a range of investment portfolios that they can offer to their end customers.
There are 45 combinations to choose from, some focused on income, some focused on ethical considerations, some tracking interest rates and some mixing and matching diverse funds.
There are actively managed funds and passive trackers as well, the most popular being a 50:50 blend of the two. Each category offers different options, from adventurous to cautious, according to investors’ individual attitudes to risk.
The fee, however, is always 0.15 per cent of assets under management, one of the lowest in the industry. Yet returns are steady and consistent, competing with the best and priciest advisory services. This mix of value and results has helped Tatton to increase sales, profits and customer numbers, with 1,100-plus advisers using the firm on behalf of 140,000 savers.
A step up: Tatton Asset Management works exclusively with independent financial advisers, offering them a range of investment portfolios that they can offer to their end customers
When Midas recommended the business in 2021, Tatton looked after almost £11 billion of assets and founder Paul Hogarth said he wanted to increase that figure to £15 billion by 2023.
He comfortably surpassed that target, now manages around £20 billion of savers’ funds and intends to take that to £30 billion in the next five years.
Hogarth was one of the first in his field to offer model portfolio services, where assets are selected and managed by
experts, allowing advisers to offer their customers plenty of choice without incurring the costs associated with individualised portfolios.
Tatton has two other businesses too. Paradigm Consulting helps financial advisers to stay abreast of compliance and regulatory requirements while Paradigm Mortgages assists advisers to secure the best products for customers. Interim results to September showed good growth across the group, with assets under management increasing, new customers coming on board and more financial advisers choosing to use Tatton’s services.
City analysts expect more of the same, feeding into rising sales and profits. A 19 per cent increase in revenues to £44 million is forecast for the year to March, rising to almost £50 million in 2026. Profits are expected to climb almost 19 per cent this year to more than £22 million, rising to nearly £26 million next year.
Hogarth, who owns 16.5 per cent of the shares, is keen to make sure there are decent dividends. Around 19p is expected for the current year, rising to 22p in 2026.
Midas verdict: Tatton shares were £4.95 when Midas recommended them in the summer of 2021. Today, the stock is 35 per cent ahead at £6.74 and brokers remain optimistic about the business. Investors looking for ready cash at the start of the year could sell down their holdings and bank some profit but the stock should continue to deliver so most investors would be advised to hold.
Traded on: Aim Ticker: TAM Contact: tattonassetmanagement.com
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